ResMed (RMD)

ResMed
had its biggest gain in three years after the company posted better than expected results for the December quarter and said it would aggressively buy back more shares. It has been buying back shares for some time and higher buyback assumptions will boost earnings forecasts. The stock jumped 7.5 per cent to $2.73 on the day of the results and has continued its climb to about $3, close to its 12-month high of $3.12. The sleep device maker, which is also listed in the US, is trading on a one-year forward price-earnings ratio of about 14, which is relatively low for the stock. ResMed does not give guidance but said its range of sleep masks were poised for more growth as new products came to market. Global mask growth was “exceptionally strong", it said. The global sleep apnoea market was estimated to be worth $US3.4 billion ($3.2 billion) last year and is growing, with many suffers undiagnosed. ResMed is the market leader in this treatment area.